Minister hopeful of getting out of FATF in 15 months

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ISLAMABAD: Minister for Finance Asad Umar on Friday sounded quite optimistic in the Senate about Pakistan getting out of the grey list of the Financial Action Task Force (FATF) and said the deficiencies identified were in Pakistan’s own interests.

Responding to a calling attention notice, moved by PPP Senators Mian Raza Rabbani, Sherry Rehman and Sikander Mandero on implications of report on the FATF grey listing, He said that Pakistan had been put on the grey list twice before but this time around, he saw the issue as more of an opportunity than a challenge.

The minister emphasised that there was no need to worry that the country might face banking and economic sanctions as a result of the FATF grey listing. But he conceded that being on the FATF was obviously a negative signal, especially for a country that had such a severe current account deficit.

“But make sure one thing that we will get out of it as we’ve 15 months and we are working to overcome the deficiencies and hopefully we will comply with the FATF recommendations,” Asad Umar said in optimism.

The minister explained, "If you look a bit closely whether it’s FATF or not, the deficiencies [as pointed out by FATF] need to be addressed at all costs as these are in our own interests. We need stop currency smuggling, we should take measures to stop hundy and hawala practices as these are the things which are not good for the country.”

Asad Umar made it crystal clear that there was no reason the government should not be able to address the watchdog's concerns within the stipulated period, which would end in September 2019.

The minister emphasised, “The next FATF quarterly review will take place in Jakarta on September 11-12. They [FATF] have identified 27 deficiencies in three broad categories, the first of which is currency smuggling. The second is the Hawala/Hundi practice and the third is related to potential terror financing of proscribed organisations.”

In order to comply with the recommendations of FATF, he said that a national executive committee, headed by the finance minister, had been formed, in which national institutions such as FIA, NAB and SECP officials have also been included.

“Our own review will take place on September 8 and be completed before the next FATF review. We have already identified the steps needed to remove the 27 deficiencies, and also assigned responsibilities. If we fulfill their requirements and remove those 27 deficiencies by then, we’ll be back on the white list," he said.

At the same time, he termed the FATF's demotion of Pakistan from its white list to grey as an exceptional treatment and expressed reservations against the procedure used by the watchdog in this connection.

About the recent visit of FATF team, the minister said that their visit had nothing to do with the country’s placement on the watchdog's grey list, as it was a routine evaluation visit. He added, "It was an FATF delegation but it was here for a separate exercise of mutual evaluation, which is conducted after every four or five years. Even if we were not on the FATF grey list, this delegation would still have come."

Earlier, speaking on the motion, Senator Sherry said that FATF listing was a national concern with serious implications for the country. She questioned what the APG’s final evaluation report was about and and what it held for Pakistan’s immediate and medium term future. The House will resume Monday afternoon and have a debate on the issue of rigging in the 2018 general elections on the admitted motion moved by PML-N’s Senator Muhammad Javed Abbasi.

ISLAMABAD: Minister for Finance Asad Umar on Friday sounded quite optimistic in the Senate about Pakistan getting out of the grey list of the Financial Action Task Force (FATF) and said the deficiencies identified were in Pakistan’s own interests.

Responding to a calling attention notice, moved by PPP Senators Mian Raza Rabbani, Sherry Rehman and Sikander Mandero on implications of report on the FATF grey listing, He said that Pakistan had been put on the grey list twice before but this time around, he saw the issue as more of an opportunity than a challenge.

The minister emphasised that there was no need to worry that the country might face banking and economic sanctions as a result of the FATF grey listing. But he conceded that being on the FATF was obviously a negative signal, especially for a country that had such a severe current account deficit.

“But make sure one thing that we will get out of it as we’ve 15 months and we are working to overcome the deficiencies and hopefully we will comply with the FATF recommendations,” Asad Umar said in optimism.

The minister explained, "If you look a bit closely whether it’s FATF or not, the deficiencies [as pointed out by FATF] need to be addressed at all costs as these are in our own interests. We need stop currency smuggling, we should take measures to stop hundy and hawala practices as these are the things which are not good for the country.”

Asad Umar made it crystal clear that there was no reason the government should not be able to address the watchdog's concerns within the stipulated period, which would end in September 2019.

The minister emphasised, “The next FATF quarterly review will take place in Jakarta on September 11-12. They [FATF] have identified 27 deficiencies in three broad categories, the first of which is currency smuggling. The second is the Hawala/Hundi practice and the third is related to potential terror financing of proscribed organisations.”

In order to comply with the recommendations of FATF, he said that a national executive committee, headed by the finance minister, had been formed, in which national institutions such as FIA, NAB and SECP officials have also been included.

“Our own review will take place on September 8 and be completed before the next FATF review. We have already identified the steps needed to remove the 27 deficiencies, and also assigned responsibilities. If we fulfill their requirements and remove those 27 deficiencies by then, we’ll be back on the white list," he said.

At the same time, he termed the FATF's demotion of Pakistan from its white list to grey as an exceptional treatment and expressed reservations against the procedure used by the watchdog in this connection.

About the recent visit of FATF team, the minister said that their visit had nothing to do with the country’s placement on the watchdog's grey list, as it was a routine evaluation visit. He added, "It was an FATF delegation but it was here for a separate exercise of mutual evaluation, which is conducted after every four or five years. Even if we were not on the FATF grey list, this delegation would still have come."

Earlier, speaking on the motion, Senator Sherry said that FATF listing was a national concern with serious implications for the country. She questioned what the APG’s final evaluation report was about and and what it held for Pakistan’s immediate and medium term future. The House will resume Monday afternoon and have a debate on the issue of rigging in the 2018 general elections on the admitted motion moved by PML-N’s Senator Muhammad Javed Abbasi.